Disapproval of Obligations under the Emergency Economic Stabilization Act of 2008

Floor Speech

DISAPPROVAL OF OBLIGATIONS UNDER THE EMERGENCY ECONOMIC STABILIZATION ACT OF 2008 -- (House of Representatives - January 22, 2009)

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Mr. SHERMAN. Mr. Speaker, I yield myself 3 1/2 minutes.

The TARP program is highly flawed. It is up to us to pass good statutory provisions, not to give blank checks to the last administration, or even this administration. We ought to improve the program. The bill we passed yesterday is just a down payment or, since the Senate may not act on it, just an attempt at a down payment on the statutory changes we ought to adopt. But the question is, how do we vote on this resolution today?

If the Senate had voted to block funding, then today's vote would be entirely different. Effectively blocking funding might be the first step in forcing statutory changes; but that is not where we are today. Instead, we are here voting on a bill that both sides agree has no statutory significance. Under the existing statute, this administration will get $350 billion subject only to the very limited restrictions imposed by the bill that we passed, and I voted against, last fall. This vote is nothing more than a nonbinding resolution. It is a joint press release. It does not trigger any statutory provision; it does not write any statutory provision.

So how should we vote on this joint press release? Is it an accurate press release? Will the press understand it, or is it written in such a way that the press will misunderstand? In order to determine that, we have to understand the press.

I would hope that we would have a press in this country that, if we had voted for this resolution, would say: "The House demands statutory improvements in the TARP program. It
demands the passage of the Frank bill and far more.'' Unfortunately, we know that will not be the headline.

It makes no sense to provide this press release to a press corps that instead will interpret it as saying: "House repudiates President Obama on the second day of his term.'' But we know the press. They will put personality over substance, politics over policy. They will write this story, ignoring the problems with the TARP bill. They don't want to write about statutory provisions; they will write about politics not policy. So signing on to a joint press release knowing that the press will misinterpret it is a bad idea.

What is a good idea is using every vehicle we have to demand that we improve the TARP program, and that starts with passing the Frank bill and putting it on appropriations bills, putting it on the stimulus bill, making it clear to the Senate that nothing moves until that bill moves. But that is just the beginning. We need statutory provisions that say, if you get TARP money, then there will be no dividends, no stock repurchases. You can't take our money, and then give your money to your own shareholders. That we require the administration to get the maximum number of warrants, so that we participate in the upside of those companies that survive. That the statute does not authorize overpaying for toxic assets or buying bad bonds held by foreign investors. And, that we have real limits on executive compensation and perks, not just for those bailed out companies that are in Detroit, but those that are in New York as well.

We have got to communicate in every way we can to our leadership and to this country that we need massive improvements in the statutory provisions of TARP. Voting "no'' on this resolution is the first step in making that clear. Voting "yes'' would just be confusing.

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